Cash Breakeven
shall be defined as the point at which there shall have
been recouped from Adjusted Gross Receipts an amount equaling
all actual distribution expenses attributable to the Picture
(provided there shall be no double deductions for any item,
including without limitation residuals), all costs of production
of the Picture (including without limitation any pre-break
participations, mutually-approved deferments and completion
bond fee), actual interest and actual financing costs related
to the Picture, a producer fee in the aggregate amount of
$5,000,000 for Andy Vajna and Mario Kassar and an overhead
charge to Intermedia Film Equities Limited equal to ten
percent (10%) of the bonded budget (with no interest on
overhead or overhead on interest). For purposes of calculating
Cash Breakeven only, Adjusted Gross Receipts shall include
a 100% home video royalty (i.e. home video revenues less
costs, provided no such costs shall be deducted if such
costs were previously deducted hereunder) to the extent
that Producer is accounted by distributors at a 100% home
video royalty or if Producer is not accounted for at a 100%
home video royalty, with respect to any Adjusted Gross Receipts,
such Adjusted Gross Receipts shall include and be calculated
with a home video royalty equal to the home video royalty
Producer receives with respect to such Adjusted Gross Receipts,
but in no event less than a 35% home video royalty. For
all other purposes (other than calculating Cash Breakeven),
including the calculation of [Schwarzenegger] Participation
and the Deferred Participation, Adjusted Gross Receipts
shall include a 35% home video royalty, or if the agreement
for the services of the director of the Picture so provides,
then such greater home video royalty shall be included in
the Adjusted Gross Receipts of the Picture for purposes
of calculating [Schwarzenegger]Participation and the Deferred
Participation. [back to archive]